In the event that a taxpayer was not able to submit and make the tax payment on time, there are penalty and surcharge to be paid upon submission of tax returns. This also applies if a taxpayer who filed the tax returns within the due date but does not pay the full amount of tax, or file the form late, neglected or avoided filing the tax return, he/she must pay additional fees and fines as prescribed by law. If he/she fails to pay, there might be criminal penalties as follows:
In case of failure to pay tax within the due date, additional surcharge of 1.5% of tax amount per month of the tax due and it must be paid within the specified time.
In case of filing the tax return on time but the tax amount was not paid correctly, there is a fine of 1 or twice the amount of the tax due, as the case may be. Such fine maybe reduced or exempted in accordance with the regulations prescribed by the Director-General with the approval of the Minister.
In the case of intentionally reporting false information or presenting false or fraudulent evidence to evade or attempt to avoid paying taxes, the penalty is imprisonment from 3 months to 7 years and a fine from THB 2,000 to THB 200,000.
In the case of intentional negligence in submitting a tax return in order to avoid paying taxes, there is a fine of not exceeding THB 200,000 or imprisonment not exceeding 1 year, or both.
Know more about your duties as a taxpayer in Thailand and make sure you submit your taxes correctly and on time to avoid the above consequences. Contact MSNA for getting tax ID, preparing and filing tax returns and tax consultation.
When a taxpayer has submitted his/her tax return within the specified deadline but there is a problem or error in the computer program or the e-filing system or payment method which resulted to the tax filing and payment to be unsuccessful, the form can be filed and the tax can be paid within 7 business days from the last day of filing via the internet and a request for an extension can be submitted.
The taxpayer must submit a petition along with the form and pay the tax at the Revenue Department’s area office along with the supporting documents as follows:-
Request for extension and a letter of consider for disclosure of information
Explanation letter of the cause of problem or error
A copy of the list submitted through the House of Representatives
Copy of Form B.Ch.35, if required
MSNA can assist individual taxpayers in filing their Thai personal income tax returns and corporate taxpayers in filing their corporate income tax returns and monthly taxes. We have vast knowledge and expertise in accounting and Thai tax laws. Make sure you submit your taxes on time. Contact us now for more information.
One of the questions our clients ask us the most is how much tax rate to use when calculating Corporate Income Tax in Thailand.
The corporate income tax rates depends on the amount of capital and its net income during the year. To explain it further:
1. If the company has less than THB 5 million capital and has less than THB 30 million income, the tax rates to be used are as follows:-
Tax Rate
First THB 300,000 = 0%
300,001 – 3,000,000 = 15%
Over 3,000,000 = 20%
2. If the company has more than THB 5 million capital and even if they decrease it later, it is fixed to 20% every year as long as the company is existing.
3. If the company has more than THB 30 million income and if the income decreases next year, it is also fixed to 20% as long as the company is existing.
Make sure your accounting and taxes are done properly and be mindful of the deadline for submission of corporate income tax and audited financial statements. Contact MSNA for consultation on Thai taxes and filing of requirements for your company in Thailand.
Corporate Income Tax is a direct tax imposed juristic companies or partnerships doing business in Thailand or those that do not do business in Thailand but getting certain types of income from Thailand.
Who are liable for Corporate Income Tax?
The taxable person are as follow:-
A company or juristic partnership incorporated under Thai law:
Limited company
Public company limited
Limited partnership
Registered partnership
A company or juristic partnership incorporated under foreign laws:
a company or juristic partnership incorporated under foreign laws and carrying on business in Thailand
a company or juristic partnership incorporated under foreign laws and carrying on business in other places including Thailand
a company or juristic partnership incorporated under foreign laws and carrying on business in other places including Thailand, in case of carriage of goods or passengers
a company or juristic partnership incorporated under foreign laws which has an employee, an agent or a go-between for carrying on business in Thailand and as a result receives income or profits in Thailand
a company or juristic partnership incorporated under foreign laws and not carrying on business in Thailand but receiving assessable income under Section 40(2)(3)(4)(5) or (6) which is paid from or in Thailand
A business operating in a commercial or profitable manner by a foreign government, organization of a foreign government or any other juristic person established under a foreign law.
Joint venture
A foundation or association carrying on revenue generating business, but does not include the foundation or association as prescribed by the Minister in accordance with Section 47 (7) (b) under Revenue Code
MSNA group of companies can assist in accounting & tax, audit and filing of the audited financial statements and corporate income tax returns with the Department of Business Development and Revenue Department. We can also help in registering the company with online tax filing system.
For filing of Thai personal income tax returns with the Thai Revenue Department, these are the cases where foreign-based income is not subject to Thai taxes.
If foreign-sourced income derived before 1st January 2024 and remitted into Thailand in a later tax year
Foreign-sourced income is derived by a foreigner who is NOT a Thailand tax resident but later remitted such income into Thailand
A foreigner is considered a tax resident of Thailand if he/she has stayed in Thailand for at least 180 days during the calendar year and has derived income either within Thailand or outside Thailand.
Moreover, foreigners must include both income sourced within and outside Thailand in the filing of his/her Thai personal income tax return. Taxable income shall be an aggregate amount of Thai-sourced income earned during the tax year and foreign-sourced income remitted to Thailand during the tax year. Hence, if foreign-sourced income is remitted partially, the taxable amount shall be apportioned accordingly.
MSNA can help Thai tax residents compute and submit their personal income tax returns. Contact us now for getting tax ID card, filing the tax returns and obtaining Tax Residence Certificate or Income Tax Payment Certificates.
One of our clients that is engaged in trading business has recently registered its branch into the VAT system with the Revenue Department. Now, they have 2 VAT registration certificates, one for the main office and another one for its branch. Today, they asked us which one to use and when it should be used.
Our reply:
When you buy things for the head office, you need to tell the supplier to issue their tax invoice to your head office. And when you buy things for your branch, then the supplier should issue their tax invoice for the branch.
The tax invoice issuer should put the word “head office” or “Branch No.1” on the tax invoice for you.
Contact MSNA for accounting and tax filing needs. Thai Lawyers can help you register your company and your branches into the VAT system.
According to Section 41 of the Revenue Code of the Thai Revenue Department, foreigners have the duty to file their taxes in Thailand as below:
Income derived in Thailand
If a foreigner has income from sources within Thailand either by employment, own business or assets located in Thailand, such income is subject to income tax whether such income is paid within or outside Thailand.
Income derived outside Thailand
If a foreigner has income outside Thailand, such income is subject to Thailand income tax if these two conditions are met:
Such income has been incurred in any tax year starting from 1 January 2024 onward by a foreigner who stays in Thailand for 180 days or more in a tax year, and;
Such income earned from 1 January 2024 has been remitted or brought into Thailand (whether wholly or partially) in any tax year from 2024 onward
For instance, a Burmese who lives in Thailand for at least 180 days in 2024 with income from Myanmar or another country brings the money earned before 2024 into Thailand in 2024, then it will not be taxed. If he/she brings the money earned in 2024 into Thailand in 2025, then it will be taxed in 2025. However, if he/she has income earned outside Thailand but he/she is not a tax resident in Thailand and brought or remitted such income into Thailand later, it is not subject to Thai tax because he/she did not stay in Thailand for 180 days or more during the tax year.
Tax Returns to be Filed
If he has income derived from employment in Thailand only, he must submit the personal income tax return P.N.D. 91.
If he has income derived within Thailand and outside Thailand or just from outside Thailand, he must submit the personal income tax return P.N.D. 90.
MSNA Group can not only help Burmese people on how to do business in Thailand, we can also help you with Thailand taxes. If you need assistance in filing your personal income tax returns in Thailand, you come to the right place. Contact us now for more information.
Today, a client whom we helped register a 100% Myanmar owned export company in Thailand asked us if it is necessary for them to be registered in the VAT system. Here is our response:
Normally, a company is required to register into the VAT system if the gross sale has reached 1.8 million Baht in a year or the company hires foreigners and needs to apply for a work permit because the VAT registration certificate is one of the documents requested by the Thai immigration bureau. Anyway, the company may choose to register into the VAT system before that. And once you are registered into the VAT system, you have to submit your monthly VAT returns (PP.30) with or without sale transactions. You can decide to apply for VAT refund from the Revenue Department later but keep in mind that the tax officer will request to see all supporting documents before giving you the refund.
Thai Lawyers can help you register the company into the VAT system. MSNA Group can handle bookkeeping, accounting, tax filing and consultation on Thai taxes. We will ensure that you’re your documents are properly kept in files for easier reference when tax authorities request to see them. We can also assist you in representing your company with the Revenue Department especially when you apply for VAT refund. However, we will not be responsible to speed up the process because it is up to the tax officials when they can finish checking your documents and consider your application to claim VAT. You may find helpful information on what to do once a company is registered in the VAT system, and how withholding taxes in Thailand work.
Who wants a Tax Residence Certificate or “Certificate of Residence”? Simply put, the foreigners who want to show it to their home country to prove that they should pay tax to Thailand and not their home country. Tax residence certificate may be issued by the Thai Revenue Department upon request by a foreigner who stayed in the country for 180 days or more in a calendar year. If you were in Thailand for such a period in many years, you need a Tax residence certificate for each year. Not one certificate is good for various years. By the way, do not confuse it with a Tax Clearance Certificate or an Income Tax Payment Certificate.
A company registered in Thailand may also request a tax residence certificate. However, here we want to talk only about individuals who may want to obtain one. MSNA Group can assist you in getting it issued by the Thai tax authorities. The two most important things are:
You need to be able to prove that you were in Thailand (continuously or not) at least 180 days in the year by showing the copy of your passport pages where there are stamps of your entries and exits.
You need to have income earned in that year and brought into Thailand the same year, or you were working in Thailand with a work permit. This way, you would file your personal income tax of that year. The Revenue Department needs to see your tax return with its official receipt and your Tax ID card.
Just contact MSNA Group so we can help you obtain your Tax ID card, prepare and file your tax return, get an Income Tax Payment Certificate or a Tax Clearance Certificate or a Tax Residence Certificate (which the Revenue Department calls “Certificate of Residence”). Essentially, the document looks like this:
What is an Income Tax Payment Certificate? When foreigners work in Thailand, they have to pay taxes here. Your Thai employer must get a work permit for you to be able to pay you legally. Every month when they pay you salary, they need to withhold your personal income tax and submit it to the Thai Revenue Department by the 7th of the following month (or 15th if they do it online). At the end of the year (or at the time you leave the company during the year), the employer must give you a document called 50 Tawi, or withholding tax certificate. The document has the detail of the total income you earned that year from this company, the total tax and the total social security amounts they withheld from you that year. However, it is not your Income Tax Payment Certificate.
When you prepare your personal income tax return at the beginning of the following year (31 March is the deadline), you will have to fill out the amount of tax withheld that is written in the withholding tax certificate. This tax is your tax credit. It is the tax you paid during the year by the employer’s withholding it from your income. If you did not have other sources of income from anywhere else, most likely you will not have to pay more taxes if your employer’s payroll team calculated your monthly withholding tax correctly. In some cases you will get a tax refund.
When you file your personal income tax return (PND90 or PND91 depending on whether you have income sources other than from work), you will get a receipt issued by the Revenue Department. This receipt is not enough of a proof to the Inland Revenue Service in your home country. You will need to request the Thai Revenue Department to issue an “Income Tax Payment Certificate”, which is in English and it is accepted as the proof that you paid taxes in Thailand.
An “Income Tax Payment Certificate” is not the same as a “Tax Resident Certificate”. The latter is the certificate issued by the Thai Revenue Department to certify that you were a tax resident in Thailand in the year it is issued for. Only when you have stayed in Thailand for 180 days or more in a calendar year can you request for a Tax Resident Certificate.
